We have been studying for some years the compound insulator at the 5 end of the chicken beta globin locus. We showed that in addition to its ability to prevent enhancer-promoter interactions, mediated by CTCF, it is also able to block the hetrochromatinization of a reporter gene. This property is independent of CTCF, but we have shown that it does depend on the binding of two other proteins, USF1/2 and BGP1. We have studied the role of USF1/2 extensively and shown that as part of its insulator function it recruits a wide variety of histone modifying enzymes, which serve to maintain nearby histones in an active state, and prevent other, repressive, histone modifications from being introduced. Our results show that USF1 interacts in vivo with the vertebrate Set1 complex, which methylates histone H3 at lysine 4, as well as PRMT1, which methylates histone H4 at arginine 3. These are present in two separate, multicomponent complexes which appear to be localized to the insulator element through specific binding of USF1/2. To understand the function of USF1, in a collaboration with the laboratory of Dr. Suming Huang, USF1-associated protein complexes were used to show that USF1 forms a multiprotein complex with hSET1 and NURF, thus exhibiting histone H3K4 methyltransferase- and ATP-dependent nucleosome remodeling activities, respectively. Both SET1 and NURF are recruited to the 5'HS4 insulator by USF1 to retain the active chromatin structure in erythrocytes. Knock-down of NURF resulted in a rapid loss of barrier activity accompanied by an alteration of nucleosome positioning, increased occupancy of the nucleosome-free linker region at the insulator site, and increased repressive H3K27me3 levels in the vicinity of the HS4 insulator. Furthermore, suppression of SET1 reduced barrier activity, decreased H3K4me2 and acH3K9/K14, and diminished the recruitment of BPTF at several erythroid-specific barrier insulator sites. Therefore, our data reveal a synergistic role of hSET1 and NURF in regulating the USF-bound barrier insulator to prevent erythroid genes from encroachment of heterochromatin We have also investigated the properties of BGP1, which binds to separate sites in the insulator. We found that Vezf1, the mouse homolog of BGP1 in mouse ES cells plays an important role in DNA methylation; in its absence methylation levels at critical sites genome-wide are depressed. We made use of an ES cell line in which Vezf1, the mouse BGP1, is deleted. In collaboration with Dr. H. Stuhlmann (Cornell Medical College) we showed earlier that in the absence of Vezf1 the DNA de novo methyl transferase, Dnmt3b, is down regulated, reflecting a decrease in the abundance of the RNA splice variant coding for active Dnmt3b. Wild type phenotype can largely be restored by introducing a Vezf1 expression vector into these cells. We have shown that Vezf1 binds in vivo to a site in an intron of the Dnmt3b gene, and this suggested that Vezf1 might interfere with RNA polymerase II elongation rates, allowing for different alternative splicing pathways. Now we have extended our investigation to a genome-wide survey, in an attempt to understand how Vezf1 suppresses Dnmt3b expression. In these studies, we asked whether Vezf1 may interfere with transcription elongation in such a way as to alter the production of specific splice variants of a gene, as suggested by the experiments described above with mouse ES cells. We find that in HeLaS3 cells there is a strong genome-wide correlation between Vezf1 binding and peaks of elongating Ser2-P RNA polymerase (Pol) ll, reflecting Vezf1-dependent slowing of elongation. In WT mES cells, the elongating form of RNA pol II accumulates near Vezf1 binding sites within the dnmt3b gene and at several other Vezf1 sites, and this accumulation is significantly reduced at these sites in Vezf1(-/-) mES cells.